Justice Inyang Ekwo of the Federal High Court, Abuja Division has dismissed a suit filed by Mobil Producing Nigeria Unlimited (Mobil) against the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Mobil had approached the court to challenge the competence of NMDPRA to regulate certain aspects of its operations like butane lifting which it maintained were integrated to its Oil Mining Leases (OMLs) and thus within the exclusive regulatory purview of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The oil firm, in its Originating Summons filed on June 19, 2023 in Suit No.FHC/ABJ/CS/844/2023, argued that the said operations were designated as ‘integrated petroleum operations’ in accordance with the Petroleum Industry Act 2021 (PIA).
It therefore prayed the court to restrain NMDPRA from all attempts towards licensing or any other form of regulation of those operations.
In its response, NMDPRA through its lawyers Ama Atuwewe (SAN) and Dr. Emeka Akabogu submitted that NMDPRA was empowered under the PIA to regulate all midstream and downstream petroleum operations in Nigeria.
The lawyers noted that the particular operations in question were outside of what the law envisaged as ‘integrated petroleum operations’.
After the hearing of the arguments of lawyersfor the parties, the court reserved its judgment for October 25, 2023.
But in a rather dramatic twist, Mobil, on the judgment day, applied to discontinue the proceedings, and urged the court to strike out the suit. In response, Counsel to the Authority moved the court to dismiss the suit, arguing that issues have been joined and there was need for a settled precedent from the court.
The court ruled that the proper order to make in the circumstances was one for dismissal of the suit.
Oil industry stakeholders commented that the “ruling holds considerable significance for the petroleum industry in Nigeria as it affirms the regulatory mandate of the NMDPRA as set out in the Petroleum Industry Act 2021 over all midstream and downstream operations including those of international oil companies involved in such activities.”
Responding to the court order, Akabogu stated that the “win is also a big step in the country’s efforts against oil theft, as it ensures separate monitoring of activities in the different streams of the oil and gas value chain undertaken by related interests.”